Definition: As per the definition by the United Nations, Poverty is a denial of choices and opportunities, a violation of human dignity. It means a lack of basic capacity to participate effectively in society.
As per the world bank , the poverty is classified into three types based on the per day earning by the people across the world.
- Extreme Poverty: People who live on less than $1.90 dollar per day.
- Moderate Poverty: People who live on less than $2 dollar per day.
- Better Poverty: : People who live on less than $5 dollar per day.
Two types of Poverty
Absolute Poverty: It defines the lack of basic amenities like food, clothing and shelter.
It is generally found in developing, under developed or poor nations.
Example: Poor countries like Somalia, Sudan , Developing countries like Sri Lanka , India etc
Relative Poverty: This is in relation to the economic status of other individuals in the society. It captures the extent of inequality in the given society.
This type of poverty is found in Capitalist and mixed economies where business is run by the private sector.
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